The rate of unemployment when the economy is at potential output is called the

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The natural rate of unemployment is the rate at which the economy is at potential output and consists of structural and frictional unemployment. This means that all other factors holding constant, the only unemployment that exists at potential output is due to structural and frictional factors rather than cyclical factors such as a recession or boom. Therefore, the natural rate is sometimes also called the "non-accelerating inflation rate of unemployment" or NAIRU, because it is the rate below which unemployment cannot fall without causing inflation to rise.

The Rate of Unemployment When the Economy Is at Potential